FRANCES AND MICHAEL HOWORTH TALK EXCLUSIVELY TO ANTONY SHERIFF, EXECUTIVE CHAIRMAN OF PRINCESS YACHTS AND HIS PLANS GOING FORWARD FOR THE GREAT BRITISH BRAND
Antony Sheriff joined the British luxury yacht manufacturer Princess Yachts as Executive Chairman in January 2016. He graduated with a B.A. in Economics and a B.S. in Engineering as well as an M.S. in Management from the Massachusetts Institute of Technology (M.I.T). Following a consultancy role at McKinsey & Company Antony spent eight years at Fiat Auto where he was Director of Product Development for Fiat, Alfa Romeo and Lancia cars. In the decade preceding his takeover at Princess, he was Managing Director of the luxury car brand McLaren Automotive. Under his stewardship, Princess Yachts is experiencing record growth, advance orders and a return to record profitability underpinned by a renewed focus on quality, technology and innovative product development at Princess’s Plymouth headquarters.
This unprecedented commercial proposition is underpinned by a stronger-than-ever presence at boat shows around the world, at which Princess plan to launch a record-breaking total of 9 new models in 2019.
Writing for ONBOARD Magazine, Frances and Michael sat down with him and asked him about his plans for the great British brand.
Antony, under your leadership at McLaren, you are credited with turning around the luxury, low-volume McLaren-Mercedes SLR project to deliver the highest volume of carbon-based road cars ever produced, how did you do that?
We worked hard to build a high-performance sports car division which conceived, designed and hand-built a range of carbon-based, ground-breaking and award-winning supercars including the MP4-12C, 650S, 570S and P1 – the world’s first hybrid supercar. At the same time, we built a global distribution network and set the foundations for McLaren to be the elite, technology-driven and profitable luxury sports car brand that it is today.
Having done that for top end motor cars can you pull off the same trick at Princess Yachts?
I am sure we can and I hope to deliver on that undertaking soon. It’s a process we have already started. We have already delivered two consecutive years of record-breaking financial results for 2017 and 2018, with its highest ever sales, a robust return to profitability, and strong advance orders. Financial results for the 12 months to 31 December 2018 show record turnover of £340.3 million that’s 24% up on 2017 figures, and a record operating profit before exceptionals of £29.8 m which is 173% up on 2017. These results make 2018 our most successful year in the 54 year history of Princess Yachts.
Besides sales have you broken any other records?
Yes, in 2018 we hit a record high for employment of 3,200. Recruitment has taken place across the business from engineering to exterior design, manufacturing to management, making Princess one of the UK’s largest specialist manufacturers. Princess also increased investment in its successful apprenticeship programme with 42 new apprentices brought into the business; apprentices now make up 4% of the workforce with a 100% retention rate following qualification.
What is your order book looking like?
Thanks to the positive reaction in the market to our new models, our forward orders are worth £700m and stretch through to 2021. A 100% of our 2019 production and 75% of 2020 production has already been booked.
That’s impressive but what do you think is driving that optimism?
Princess Yachts represents good value to the UK economy with over 90% of Princess’s yachts exported to customers around the world. True to the motto of ‘Crafted in Plymouth’, over 80% of each yacht excluding engines of course, is manufactured in the city.
That must make you feel very proud.
Yes, I am really proud of what my team has achieved in 2018. Their focus and dedication enabled Princess to build on the previous two years of solid financial figures and beat 2017’s record results. The team launched six stunning new luxury yachts while growing revenues to over one third of a billion pounds.
The strong financial figures we have just spoken about will enable us to build upon our unique, highly integrated infrastructure in Plymouth and invest even more in advanced technologies, new yachts and quality levels across design and production. We continue to forge ahead in our vision to be not just the highest quality, most innovative and successful luxury yacht manufacturer in the world, but also a great British employer.
What is underpinning these strong sales, production and recruitment numbers?
I think it is the innovative yachts targeting new segments such as the R35, and the game-changing X95 Superfly, a superyacht due to be officially launched at Düsseldorf in January 2020. As sales, commercial results and recruitment hit new heights, so does investment. Supporting its longer-term plan, Princess continued to invest in a sustainable strategy to ensure that the business continues to drive forward product innovation and its manufacturing capabilities. As a result £14.7m (2017: £8.9m) was invested back into product development in 2018. With over 75% of each yacht manufactured in Plymouth, Princess continues to invest in its UK sites, adding capital expenditure of £9.0m to the additions in 2017 of £3.7m.
These are exceptional figures. What are they based on?
They are based on a combination of strong sales at the industry’s three biggest global boat shows – Cannes, Fort Lauderdale and Düsseldorf – and new levels of interest in the brand driven by increased investment in design and technology, progressive new global retail partners, and innovative marketing activity. 2019 began in equally buoyant form with strong orders secured at the 2019 Düsseldorf Boat Show in January, which saw 21 yachts ordered, worth in excess of £60m.
We are now into our fourth year of a five-year £100m turnaround plan since I took the helm in 2016, introducing new processes, technologies and business strategies that combine the best of Princess’s traditional yacht-making skills with best practice honed during 20 years of leadership at international automotive brands.
With customer demand at an all-time high, our five boatyards in and around Plymouth are working at maximum capacity and the order books are full throughout 2019 and for much of 2020.
Are you having to call upon help to make these investments?
To help drive this plan HSBC UK Bank plc and National Westminster Bank plc are pleased to announce their support for the refinance of Princess Yachts, backed by L Catterton which is a partnership between LVMH and Groupe Arnault, as part of the growth of the business, having constructed a multi-year funding facility as of the 16th of May, this year.
You mentioned the R35 a yacht you famously launched as the Bateaux in the Chateaux during the Cannes Show last year What can you tell us about that boat?
It is a revolutionary carbon fibre R35 performance sports boat that we built in partnership with Ben Ainslie Racing Technologies – the world’s first luxury yacht with a fully carbon fibre hull. It is a ground breaking new model that has carved the path for an assault of new product designed in collaboration with Princess Yachts, naval architects Olesinski and the world renowned styling house Pininfarina. In building her we are showcasing innovative, lightweight and sustainable materials along with new technologies. She is a fully carbon fibre boat with all the advantages in weight savings, and the Esthec synthetic teak deck, which comprises of 25% recycled materials along with natural resins, fibres, minerals and colour pigments. The active ride control foiling system that we have pioneered at Princess gives fuel savings of up to 30% at cruising speeds on the R35, and I can confidently predict that this technology will soon be seen on future bigger yachts.
Does Princess Yachts have a USP?
I think our USP lies in our ‘Crafted in Plymouth’ moto. 80% of each yacht (excluding engines and glazing) is manufactured at Princess’s five Plymouth boatyards from raw materials, making Princess one of the UK’s largest furniture manufacturers, and ensuring that it has control over the design, timings and, most crucially, quality.
Design is absolutely critical to our success, as it is to all luxury projects. Throughout everything it does, Princess focuses intensely on design elegance and surfacing, ensuring each project is of the highest standard in terms of both aesthetics and build quality.